National Broadband Network - Select Committee Report

This is a very important part of the process of scrutiny and accountability for the National Broadband Network. Senators will recall that this is perhaps the largest infrastructure project ever undertaken by any Australian government, certainly in recent times. Senators will also recall that, in spite of repeated requests by the coalition, there has still not been a cost-benefit analysis of this project.

With the new paradigm in government, and the last election result being so close, the Independents, as part of their agreement with the Gillard government, indicated they wanted greater accountability and scrutiny. A deal was then done so that a Joint Committee on the National Broadband Network would be established with roughly equal numbers of government and non-government members. It was then determined that Mr Oakeshott would become chairman of that committee. I stand to be corrected if I am wrong here, but I suspect that was part of the deal in dividing up the spoils of office for the new government. The terms of reference of this committee were that the committee would more or less take the place of the cost-benefit analysis and would generally look at all aspects of this huge expenditure of taxpayers' money. I continue to sayjustifiably, I thinkthat this is a project which will involve in excess of $55 billion expenditure of taxpayers' money and that it therefore should be very clearly scrutinised by the parliament on behalf of the Australian taxpayer.

The NBN Co. has already been given extraordinary exemptions from parliamentary and regulatory oversight. These include an exemption from review of the Public Works Committee of parliament. That is quite unusual for an expenditure of this amount of money on infrastructure. The passing of the telecommunications legislation amendment bill limited the ACCC's oversight of commercial agreements undertaken by NBN. There is, as I have mentioned, a lack of any cost-benefit analysis by the Productivity Commission or any other competent agency to examine whether the objective of universal and affordable broadband was most cost effectively and speedily achieved by the NBN project. There has been a failure by the government to release the 400-page NBN corporate plan in full. We have got bits and pieces of it but not the full 400-page document. It has also been exempted from freedom of information laws. Therefore it was essential that this joint standing committee set up to oversight the NBN should have the powers to do that. I am a member of the committee and to date we have been stymied in getting the full information that we need to properly assess the NBN and its rollout. In fact, NBN Co. has applied for the right to increase prices on most services, excluding the basic ADSL speed equivalents, by up to CPI plus five per cent per year. By comparison, the price of access to Telstra's copper network has fallen seven per cent each year in real terms since 2000, and figures compiled by the OECD show that between 2005 and 2010 the price of ADSL broadband in Australia fell by 69 per cent in nominal dollars. The recent history of broadband connection shows a downward trend, a falling of prices, but the NBN is seeking permission to increase its prices by CPI plus five per cent per year over the next several years. It appears to the coalition members on the committeeand this is mentioned in the dissenting report of coalition senatorsthat the government equity injection is explicitly structured to hide the inherent risk of the NBN project from taxpayers and investors in other communications companies, in breach of the competitive neutrality principle supported by both Labor and the coalition until quite recently.

I want to comment on a number of aspects of the joint committee's work, although time will not allow me to deal with all of them. I draw the Senate's attention to the coalition's dissenting report, which outlines a number of problems with the NBN rollout. I will not go into this in fullour report sets out evidence of these problems in some detailbut there have been ongoing delays in the rollout. That is mentioned on pages 62 and 63 of the report. There are also difficulties with what are claimed by NBN to be confidentiality provisions that really do restrict the ability of the committee to fully oversight this infrastructure rollout. There are a number of other issues that I would like to emphasise but, as I say, time will beat me. I do suggest that anyone interested in this NBN rollout have a look at the coalition's dissenting report.

Perhaps the worst problem that I foundand I was disappointed that although I was supported by my coalition colleagues the majority of the committee did not support me when I raised itwas that we wanted an oversight committee to at regular times be given details of how many kilometres of fibre had been rolled out this week or this month, how many connections had been made, how much money had been spent, how much money had been drawn down by the NBN from its government facilitiesthe sorts of things that we would have expected as an oversighting committee, looking at the expenditure of some $55 billion plus of taxpayers' money, we would be able to get as a matter of course. We are being told by NBN and the governmentand regrettably the committee chairman sided with the governmentthat this sort of information is not regularly available. As I said at the meeting, surely Mr Quigley, the NBN chief, every week gets a report from his people telling him how much has been rolled out and how many subscribers have been connected. They must have that informationwhy is it not being made available to members of this joint committee that is supposed to be oversighting the whole procedure We were given some excuse that to my mind did not seem to have any validity whatsoever. It is disappointing that the committee which is supposed to oversight this massive government expenditure of taxpayer funds is not able to do its job because it is not getting the full information that we thought it might be entitled to.